Office

Chicago Q1 2025 Quarterly Report

Michael Morrone May 08 < 1

Key Highlights:

  • Flight-to-Quality Dominates
    The “flight-to-quality” trend has intensified post-pandemic, with tenants flocking to the newest, best-located properties — especially within Stream’s defined Tier I Class A inventory, which boasts a low 13.5% vacancy rate.
  • Large Block Availability is Shrinking
    Only nine available blocks over 100,000 SF remain in Tier I buildings across the CBD — and just five of those are in high-rise settings. This scarcity is creating urgency and competition among top-tier tenants.
  • Tier II Assets Gaining Momentum
    With Trophy space tightening, well-located Tier II Class A buildings (primarily in the West Loop) are seeing increased attention as viable alternatives for space upgrades.
  • Limited Development
    With only one new office development in Fulton Market and two major repositioning projects in The Loop, Class A vacancy should tighten, as the CBD’s next major development cycle likely will not commence until 2029 at the earliest.
  • Leasing Activity Accelerates
    Leasing activity (including renewals) increased 22.4 percent year-over-year.

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